Spending on technology in the small business sector – of which around a third are retailers, or connected to retail – is set to soar in 2023 worldwide as they look to become more efficient and to be more competitive.
So finds research that looked at the spending plans across 132 tech sectors in 52 countries and concluded that the world’s 145 million SMEs are set to spend a whopping $1.45trn on tech this year.
This sees spending spring right back to where it was pre-pandemic and its is being driven by smaller firms seeing the need to combine meeting customer demands – which are increasingly drawn to being wowed on a personal level – with trying to save money as the cost-of-living crisis continues to bite.
The upshot, alongside hopefully delivering that personalised and ‘wow’ customer experience and delivering rapid ROI, is that it suddenly makes for a much more level playing field for these smaller businesses.
The rise of cloud-based platforms as a service (PaaS) in many ways democratises technology, even the cutting edge, metaverse-y stuff, so that whether you are globe straddling multi-national, or a regional bespoke vintage sneaker seller, you can add VR, AR and AI to your operations without breaking the bank – or breaking your IT systems, as you just plug into a cloud interface.
This can only be good news for smaller retailers. AI already plays a big role in marcoms, product development, merchandising and social influence, yet many smaller retailers just aren’t on board with it. While many need more data – which we shall come to – most don’t know where to begin with AI.
Research shows that AI is vital across businesses these days, from resource planning to product design to marketing and even logistics. Finding the right AI is increasingly baffling to many business managers and owners.
The trick is that it isn’t a thing that you buy, rather it is about choosing the right platforms and platform partners to work with to gain access to their solutions that are AI-powered. This way – again through a PaaS strategy – smaller retailers can leverage efficiencies and insights that, until now, have been the preserve of the big boys.
But AI is nothing on its own. What it feeds on is data – and many SMEs are not that great at gathering, sorting and using that data. This is strange, as consumers young and old are increasingly willing to part with personal data in return for bargains, discounts and perks. According to a study, three quarters of millennials – the largest single group of shoppers currently – are willing to part with data if they get what they want. Gen Z is more like 60% and Gen X, the 42-57 year olds, sits at wound 54%, but overall, more than half of all shoppers are willing to part with data to get a better service.
This should be music to retailers’ ears as it means that the single thing they need to feed the tech that they are keen to invest in is readily available. All you need to do is balance the discounts with the increase in ARPU and 2023 could see growth despite the downturn.